Rising legal fees continue to eat away at the City of Powell’s general fund, which isn’t sitting well with City Council.
On Tuesday, council approved a request by Finance Director Debra Miller to modify appropriations for 2017 by transferring $60,000 — $35,000 from the council contingency fund and $25,000 from the unappropriated general fund balance — to general fund legal fees.
“As (council is) aware, the last couple of years the city has had several legal cases,” Miller said. “We’ve got rid of one, but one of the others is speeding up.”
Director of Communications Megan Canavan confirmed the ongoing legal dispute in question involves a proposed extended-stay residence.
In July 2016, The Gazette reported court documents had been filed in U.S. District Court against the Powell Zoning Board of Appeals for refusing to issue a decision on a proposed hotel for Golf Village North.
Triangle Properties has proposed construction of an extended residential-stay hotel near the intersection of Sawmill Parkway and Seldom Seen Road.
Joseph Miller, the attorney representing Golf Village and Triangle Properties, states in the paperwork filed with the U.S. District Court, “Mr. (David) Betz (director of development) refuses to issue any decision of whether Golf Village’s proposed residential hotel is a permitted use under its zoning.”
Miller adds, “Powell’s own zoning laws absolutely allow a motel for the traveling public to be built on the property. We’re asking the city to discharge their duty under their own laws.”
As for the financial toll legal cases have had in 2017 on the city’s general fund, the total prior to council approving the additional $60,000 on Tuesday stood at $244,000, Debra Miller said.
She added the total doesn’t include prosecutor fees or the $1.8 million settlement — cost the city $950,000 and its insurer, Great American Insurance Group, $850,000 — brought against the city by CV Real Property after U.S. District Court Judge James L. Graham ruled last year that a voter-approved charter amendment banning high-density housing in downtown Powell, like the Center at Powell Crossing (a proposed retail complex with 64 apartment units), was unconstitutional.
When asked by council if the city expects to continue shelling out hundreds of thousands of dollars in legal fees per year, Law Director Gene Miller said he’s optimistic court cases won’t become a common means of settling disputes in the future.
“These pieces of litigation I hope are not a trend in terms of other pieces of litigation popping up, but we have some aggressive developers … we have some aggressive citizens,” he said. “We would prefer to resolve our disputes in nonjudicial forums, but in all these cases we are not the plaintiff, we are the defendant.”
Council member Frank Bertone said the funds spent this year on legal cases would have “paid for some nice bike paths or some road improvements.”
Mayor Brian Lorenz added, “Like Frank mentioned, this really costs all of our residents. It’s extremely disappointing.”
Council on Tuesday unanimously approved the proposed 2018 budget.
“In addition to being a financial tool for the city, (the budget) also lays out what type of services we are going to be providing the residents and businesses in the upcoming year,” City Manager Steve Lutz said. “The proposed budget does continue to provide services that we did this past year with some small, minor increases.”
The approved budget for next year shows total revenues in the general fund are expected to reach $8,548,237, while expenditures are anticipated to total $8,767,139.
Lutz said the proposed operating expenditures exceed the proposed operating revenues by $219,000 due to the city’s “conservative budgeting” in which it overestimates expenditures and underestimates revenues.
He added a 10-year analysis of past budgets “identifies where eight of the past 10 years we’ve had excess revenues.”
In addition to a “rainy day” fund of $1.16 million, the proposed budget estimates the general fund will have an unappropriated balance of $4,523,000 at the end of 2018.